Higher fuel costs raise July rates

Higher rainfall and cheaper natural gas will keep the fuel cost portion of TVA’s July electricity bills at their lowest price since the utility added the monthly fuel cost adjustment five years ago.

July fuel costs will be up slightly from the June rate, adding 16 cents to the monthly electricity bill for an average Chattanooga household using 1,295 kilowatthours of power. But compared with a year ago, the typical Chattanooga power bill in July for a household using an average amount of power should be $2.41 cheaper, dropping from $142.71 in July 2017 to $140.40 next month, assuming the use of 1,295 kilowatthours of electricity.

TVA spokesman Scott Brooks said the overall system average fuel rate for July is approximately 16 percent lower than the three-year average July fuel cost.

“This is the first time that the fuel cost in July has been below 2 cents per kilowatthour,” Brooks said. “This is normally the time of year it spikes because of the hot weather, but we are benefiting by more hydro generation (because of above-average rain) and lower cost natural gas (which fuels many of TVA’s newest power generators.)”

TVA is planning another 1.5 percent base rate increase in its wholesale rates for the fiscal year beginning Oct. 1, although there has been some opposition to that proposal from Volunteer Energy Corp. and other TVA distributors. The TVA board will vote on the rate increase as part of its consideration of the fiscal 2019 budget at its August board meeting in Knoxville.